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The search for competitiveness in automobile assembly is tending towards more cautious and selected investment in flexible automation technology. During the 1980 s a number of car makers were lured by the myth of computer-integrated manufacturing, but recent surveys show that approaches to automation (especially in final assembly) have changed. This longitudinal study illustrates, on the basis of a plant survey, the automation strategy of Fiat Auto, one of the world’s largest auto producers, tracing its evolution from the experiments of the 19 70s driven by industrial relations pressures, to the ‘pan-technologist’ philosophy underlying the ‘highly automated factory’ of the 1980s, to the more realistic concepts inspiring the ‘Fabbrica Integrata’ organizational model of the 1990s. The paper shows that the implementation of automation techniques and the development of related know-how have a cumulative and path-dependent nature. Furthermore, it is argued that the technologies used in a firm's plants result from a non-linear learning process, based on the internal development, external acquisition, imitation, analogical replication, combination and selection of capabilities. The knowledge incorporated into technologies becomes an integral part of a firm's repertoire of capabilities. Parts of this knowledge can be retrieved over time, to become modules of original technological solutions. Similarly, the necessity to imitate competitors who have successfully implemented organizational paradigms based on lean manufacturing in order to respond to the ‘regime of variety’ can cause a mismatch between the existing and the desired technological trajectory of a firm.
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